SEGMENTING REPORTING

12 Months Ended

Dec. 31, 2024

Segment Reporting [Abstract]

SEGMENTING REPORTING

21. SEGMENTING REPORTING

The Company’s principal operating segments coincide with the types of products to be sold. The products from which revenues are derived are consistent with the reporting structure of the Company’s internal organization. The Company’s two reportable segments for the years ended December 31, 2024 and 2023 were the Inventory Management Solutions segment and the Corrugated Packaging Business. The Company’s chief operating decision maker has been identified as the Chairman and CEO, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company.

Segment information is presented based upon the Company’s management organization structure as of December 31, 2024 and the distinctive nature of each segment. Future changes to this internal financial structure may result in changes to the reportable segments disclosed. There are no inter-segment revenue transactions and, therefore, revenues are only to external customers.

EIGHTCO HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the Years ended December 31, 2024 and 2023

21. SEGMENTING REPORTING (continued)

The CODM evaluates segment performance based on net revenues, cost of revenues, gross profit, and selling, general and administrative expenses. These items are reviewed by segment. Depreciation and amortization is also monitored by management and presented below. Certain other costs, such as interest expense, other income (expense), and income taxes, are managed on a consolidated basis and not allocated to segments.

Segment operating profit is determined based upon internal performance measures used by the chief operating decision maker. The Company derives the segment results from its internal management reporting system. The accounting policies the Company uses to derive reportable segment results are the same as those used for external reporting purposes.

Segment operating income excludes certain corporate costs that are not allocated to segments, including corporate-level general and administrative expenses and unallocated shared services. These items are disclosed separately as “Corporate.”

Management measures the performance of each reportable segment based upon several metrics, including net revenues, gross profit and operating loss. Management uses these results to evaluate the performance of, and to assign resources to, each of the reportable segments.

The Company does not allocate impairment charges, interest expense, income taxes, or other non-operating income or expenses to segments. Segment asset information is disclosed where reviewed by the CODM.

Segment information available with respect to these reportable business segments for the year ended December 31, 2024 and 2023 was as follows:

	For the Years Ended December 31,
	2024			2023
Revenues:
Inventory Management Solutions	$	39,621,272		$	67,568,353
Corrugated Packaging (Discontinued Operations)		6,823,277			7,729,131
Total segment and consolidated revenues	$	46,444,549		$	75,297,484
Cost of revenues:
Inventory Management Solutions	$	33,639,274		$	61,308,561
Corrugated Packaging (Discontinued Operations)		4,980,338			5,496,462
Total segment and consolidated cost of revenues	$	38,619,612		$	66,805,023
Gross profit:
Inventory Management Solutions	$	5,981,998		$	6,259,792
Corrugated Packaging (Discontinued Operations)		1,842,939			2,232,669
Total segment and consolidated gross profit	$	7,824,937		$	8,492,461
Income from operations:
Inventory Management Solutions	$	(2,753,757	)	$	(3,063,241	)
Corrugated Packaging (Discontinued Operations)		402,975			702,645
Corporate		(6,368,802	)		(7,116,576	)
Total segment and consolidated income from operations	$	(8,719,584	)	$	(9,477,172	)
Depreciation and amortization:
Inventory Management Solutions	$	2,280,836		$	2,830,306
Corrugated Packaging (Discontinued Operations)		173,836			214,225
Total segment and consolidated depreciation and amortization	$	2,454,672		$	3,044,531
Revenues by geography:
North America	$	13,309,349		$	14,634,111
Europe		33,135,200			60,663,373
Total geography and consolidated revenues	$	46,444,549		$	75,297,484
Segment capital expenditures:
Inventory Management Solutions	$	826		$	51,922,852
Corrugated Packaging (Discontinued Operations)		69,272			2,967,629
Corporate		-			2,409,913
Total segment and consolidated capital expenditures	$	70,098		$	57,300,394
Segment total assets:
Inventory Management Solutions	$	46,533,449		$	50,023,910
Corrugated Packaging (Discontinued Operations)		1,798,239			2,967,629
Corporate		2,516,667			2,419,904
Total segment and consolidated assets	$	50,848,355		$	55,411,443